Ok, the video does run; awesome! But now my level won't load when I hit a key. The window just turns blue and hangs.

Here's the code I have after the wait (excuse the fact that I don't know how to properly format for this forum, I'm such a nube):

camera.ambient = 100;
camera.arc = 90; // set camera.arc to a proper value for shooter games
fps_max = 75; // limit the frame rate to 75 fps (not really needed)
video_screen = 1; // start the game in full screen mode
video_mode = 8; // run at a 1024x768 pixels resolution on monitors with a 4/3 aspect ratio
level_load ("shooter.wmb");
wait (3);
media_loop("action.mp3", NULL, 70); // start the soundtrack